Eight things you wish you knew about cash transfer... but don’t, because even the PM and his cabinet have no idea
Prasanna Mohanty | January 7, 2013
Hours to go before the union government launches what is being touted as the ultimate game changer, Direct Benefits Transfer (DBT) – handing over cash for subsidies and other social welfare schemes directly in the Aadhaar-linked bank accounts of the beneficiaries – and yet little is known about it.
Earlier called Direct Cash Transfer (DCT), this programme is supposed to be launched on January 1 in 51 districts across the country, covering 29 schemes to begin with and then expanded to 42 schemes. The importance of DBT can be gauged from the simple fact that the PM-in-the-waiting Rahul Gandhi had recently told his party workers that it would ensure electoral victory for the next two general elections. UPA has even found a catchy slogan to go with it: Aapka Paisa Aapke Haath (You money in your hand).
Let us look at some basic facts.
1. Who will launch it? So far all that is known is that rural development minister Jairam Ramesh will launch it a day later, on January 2, in Gollaprollu Mandal of East Godvari district in Andhra Pradesh. Commonsense will dictate that at best this can only be a secondary function. The big event has to have all the Big Three – PM, Sonia Gandhi and Rahul Gandhi – have to do the honours. Ramesh is not the political face of the UPA.
2. How many districts will it cover? It was supposed to cover 51 district in the first phase. The number was cut to 43 because 8 districts coming under Gujarat and Himachal Pradesh, where elections were held recently, had to be kept out. There is no information yet whether these 8 districts have been added to the list.
But that is not the only source of confusion. As per the proposed guidelines, only those districts in which 80 percent of population has Aadhaar numbers will be taken in. By this yardstick, only 17 districts qualify. Another 15 districts have 50 to 80 percent coverage. Even UIDAI has no idea about the rest.
In all probability then, DBT will be launched in 17 districts. In any case, some of the poorest states, Bihar, UP, Odisha and West Bengal, are not even in the list of states to be covered in the first stage.
3. How many beneficiaries have bank accounts? Even FM doesn’t know that. It is generally believed that only 30 percent of the population has bank accounts.
4. How many individuals will benefit on the first day? Evidently, nobody knows at present.
5. How many schemes will be covered on the first day? It is supposed to be 29, but you never know. Besides, all these 29 are either scholarships or pension schemes. This means, they are already getting cash. So, what’s the big deal? Well, for one, there is a possibility that the beneficiaries will now get their payments monthly, instead of ones in three to six months, as Ramesh himself has been pointing out.
6. When will cash be given for subsidized goods like food, fertilizer, LPG cylinders and kerosene? There are serious logistic issues which may take up to a year to sort out and hence, nobody really knows.
7. What about digitization of data base – that will link the beneficiaries to their Aadhaar numbers and their bank accounts? At the union government level, we know it is in the primitive stage. Most of the states, who really posses the bulk of the data base, are known to be technically challenged. So it is anybody’s guess.
8. How will the beneficiaries be identified? We know the existing lists of beneficiaries are highly defective and hence, diversion and leakages in the social welfare schemes. To prevent that, the union government launched socio-economic and caste census (SECC) in February 2011 and was supposed to be completed by the end of that year. Latest information from the rural development ministry (which is carrying it out) suggests that the data will be ready by April 2013.
The data will then go to the Planning Commission, which will consult the state governments before preparing the list of the beneficiaries on the basis of this data (which will only rank families on the basis of certain parameters). Rural development ministry’s guess is that it will take at least another year. By the time the exercise is over, it will be, hopefully, April 2014.
Until then, we are condemned to follow the existing defective lists of beneficiaries. And if you are expecting to see your family listed for DBT, there is no hope until April 2014.
Imagine, Ramesh actually said in a signed article in Hindu (December 11, 2012): “At the outset, it must be emphasized categorically that this (DBT) is not an initiative driven by electoral calculations…”
Really, Mr Ramesh?
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